Swift & Co. v. United States

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196 U.S. 375 (1905), argued 6–7 Jan. 1905, decided 30 Jan. 1905 by vote of 9 to 0; Holmes for the Court. In Swift, the most prominent antitrust action against the Beef Trust, the Court abandoned the restrictive interpretations of its earliest antitrust holdings and accepted a broader definition of the federal commerce power. Enjoined under the Sherman Antitrust Act, Swift contended that the statute was vague and that company's activities were wholly intrastate, thus being outside the reach of federal commerce power under the doctrine of United States v. E. C. Knight Co. (1895). A unanimous Court rejected Swift's argument, holding that a combination that excluded competitors with intent to monopolize interstate commerce violated the Sherman Act. Justice Oliver Wendell Holmes framed the stream of commerce doctrine to produce a “practical,” rather than a “technical, legal conception” of commerce (p. 398). The recurring series of acts by which the Beef Trust operated, from shipping to sale of cattle and with only temporary interruptions in the flow, amounted to a current of commerce among the states, however intrastate the nature of the independent acts. Moreover, Swift's anti-competitive impact on commerce was a direct restraint of trade. Noting that intent might render unlawful even independently lawful components of a scheme, Holmes elevated the importance of intent in defining corporate restraints of trade and attempts to monopolize commerce.

As the administration of President Theodore Roosevelt shifted from trust-busting to regulation, the Swift decision attracted little notice. The “stream of commerce” doctrine remained an untapped resource until the 1930s, when the New Deal Court restored expansive readings of the commerce power. Under the leadership of Chief Justice William H. Rehnquist, however, the Court has shown an increasing willingness to limit the sweep of the commerce power and with it the stream of commerce doctrine. For example, in United States v. Lopez (1995), the high court struck down a federal law making it a crime knowingly to possess a firearm within one-thousand feet of a public or private school because the act did not flow from any enumerated power and the Commerce Clause was insufficient to provide the Congress with constitutional authority to do so.

Barbara C. Steidle

Subjects: Law.

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